Though recession has hurt the Balkan state, many Croatians see a better future in the EU.

ByPeter Geoghegan, ContributorJune 28, 2013

The European Union and Croatian flag is seen in Zagreb, Croatia, last week. On July 1, Croatia will become the 28th member of the EU.

Antonio Bronic/Reuters

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Zagreb, Croatia — During the recent local elections in Zagreb, almost every candidate was keen to stress their pro-European Union credentials. In the city’s Cvetni Trg, or Flower Square, some councilors handed out bumper stickers with the EU's starry logo to passing shoppers. Others appeared on platforms festooned with Croatian and European flags.

Croatia is not yet a member of the European Union but it soon will be. On Monday, the Balkan state of just over 4 million people will become the 28th country to join the EU, and only the second from the former Yugoslavia – Slovenia joined in 2008.

"I am looking forward to joining the European Union. As a young person, I personally think it is the best option for Croatia," says Danijel Bicanic, a recent psychology graduate working in Zagreb.

Europe’s ongoing economic and political difficulties do raise some concerns in Croatia – which is suffering its own economic woes. But many believe that membership in the EU will help reinvigorate Croatia's economy and tackle its corruption.

"I am not really concerned with the problems that are now in the European Union, because there are also so many internal national problems. I am more concentrated on those," says Mr. Bicanic.

Tight times in Croatia

Croatia certainly has its fair share of local problems. The economy, which has scarcely grown since 2008, is back in recession and is expected to shrink by 1.5 percent of GDP this year. In March, unemployment stood at 21.6 percent.

Croatian politicians have been keen to stress the benefits of being part of the world’s largest trading bloc, but are playing down expectations that EU membership will bring an overnight reversal in the country’s fortunes.

"We are very aware that the European Union will not solve all our problems," says Andrea Zlatar-Violic, Croatia’s minister for culture. "But it is very useful for us not to be one closed society, one closed state but to be open and without frontiers."

Although any expansion of the EU in the Balkans is unlikely in the foreseeable future, Ms. Zlatar-Violic believes Croatia has an important role to play as a standard bearer for the region in Brussels.

"We really don’t want to be a wall between the Balkans and the European Union. We want to be completely open," she says, "to organize a new Balkan space, a new public space, for all our experiences."

New markets

EU accession will have a significant effect on the Croatian economy, says Vuk Vukovic, lecturer in political economy at Zagreb School of Economics and Management.

Clustering, where groups of inter-related industries are encouraged to locate close together and collaborative, has been a popular economic strategy in Croatia. But Dr. Vukovic says that businesses that have not adapted to entry into the European Union by forming clusters"will experience great difficulties and most likely go under."

"On the other hand," he adds, "there is a possibility that the new increased competition from the EU will encourage new innovative solutions among Croatian entrepreneurs and thus contribute to more wealth creation."

A number of EU members – including Britain, Germany and the Netherlands – have placed restrictions on Croats traveling to work. Despite this, many in Croatia are worried about rising emigration, especially among young people, in the wake of the increased freedom of movement that EU membership will bring.

Vukovic believes that such a rise in emigration might actually help Croatia’s labor market – at least in the short term. Young people leaving for jobs in the rest of the EU would reduce unemployment in Croatia and lead to an increase in remittances sent back home. However, with an aging and diminishing population, Croatia can ill afford to lose its best and brightest for good.

Still, it might not come to this, says Vukovic. "The poor labor market situation across Europe may after all keep the people at bay."

Arguably Croatia’s greatest asset is its 1,100-mile Adriatic coastline, peppered with spectacular islands. Hopes are high that EU membership will be a boon for the country’s tourism sector, although there are fears that increased numbers of foreign visitors will put prices – and particularly land values – beyond the reach of most locals.

'A chance to move on'

Opposition to EU membership has risen since the eurozone crisis, but most Croatians still support joining the EU. The Associated Press reported earlier this month that according to recent surveys, some 60 percent of the population are in favor of entry, though only 49 percent believe that their country will benefit.

Some Croatians cite the EU's role in strengthening transparency in Croatia and tackling the corruption that flourished after independence.

In 2012, former Prime Minister Ivo Sanader was convicted of accepting bribes. The onetime head of Croatian Democratic Union is still on trial facing further corruption charges. "Without outside pressure, the people feel this would have never been revealed," says Vukovic.

Back on the streets of Zagreb, Bicanic typifies the cautious optimism that characterizes many Croatians’ attitudes toward EU membership. "Europe is our chance to move on" from the past, he says.

"It’s a chance to develop our society, to meet new people. I am really trying to look forward and not look back, because there is no sense to doing that."